On the same day that Alan Greenspan voiced his error in presuming that the self-interests of organizations were “best capable of protecting their own shareholders and their equity in the firms,” my local paper’s headline story revolved around the fear and greed of two feuding neighbors. Clearly the basic human attributes of fear and greed (along with love, compassion, envy and lust to name just a few) have directed the actions of individuals over the millennia. How could Greenspan, even with his Libertarian viewpoint, have truly expected a corporate entity to behave in a monolithic fashion? Regardless of accounting principles that refer to an entity as a single organization, businesses are made up of individual humans, each motivated by his or her own compass of fear, greed, envy, love, compassion and a multitude of other human characteristics.
In my town, one family has alleged that their neighbors have created a campaign of fear with the goal of stopping opposition to their home expansion plans (i.e. greed). Not only is it unsurprising that this atrocious behavior takes place across America, but it is also not surprising that this would be the lead headline in a week in which the markets are plummeting and the presidential election is only 2 weeks away. Humans not only perpetuate fear and greed, but they enjoy hearing about the success and failures of others’ fear and greed. Our hometown editor is aware of this basic truism, how could Greenspan have missed this basic tenet of human nature? Twenty years ago Tom Wolfe, in Bonfire of the Vanities, created a fictionalized best seller based upon the greed and fear of Wall Street individuals. Perhaps Greenspan had no time to read Bonfire of the Vanities, or even his local newspaper, but surely he was not so isolated as to not have witnessed the powerful motivation of greed in action. If only Greenspan had focused on psychology along with his economics courses.
